Cement.com and Other Dead Weight

Share

Cement.com and Other Dead Weight

Fizzle!

That's the sound of another plug getting pulled on a dot-com, an all-too-familiar scenario in Lori Gottlieb and Jesse Jacobs' hilarious new book on the rise and fall of the New Economy.

Good and gossipy, Inside the Cult of Kibu (Perseus Publishing, 299 pages, $26) takes readers through the days of the startups, from their lavish launches and IPOs to their follies of mismanagement and dramatic collapses.

The book is full of first-person stories of the heady days of the dot-coms from nearly 100 individuals who helped shape the digital decade. Inside.com's Kurt Anderson; Auren Hoffman, founder of Kyber Systems; Steven Overman, executive assistant to Wired magazine co-founders Louis Rossetto and Jane Metcalfe; and DEN's David Neuman are among the movers and shakers sharing memories.

Inside the Cult of Kibu will have dot-commers scrambling to the index to see if they or their companies made it into the book.

The dot-com debacle is a by-now familiar story, but Gottlieb and Jacobs revisit the era with a sharp sense of irony that will leave readers nodding their heads in recognition.

Gottlieb is particularly qualified to document the time. Framing this history of the dot-com decade is Gottlieb's own account of working as editor in chief at Kibu, an Internet startup for teenage girls that never developed a business model and that burned through $22 million of financing before crashing.

As the other dot-com pioneers trace the arc from idea to IPO to unemployment, Gottlieb echoes their story with her own extremely funny account of life at Kibu. Her accounts of dealing with the "Faces" – Kibu's online personalities who also wrote content for the website's 20 channels – are exceptionally funny.

Before Gottlieb was "unhired," she regularly dealt with scenes such as "When I asked one Face to rework a paragraph, she sulked for days and accused me of 'liking the other Faces better.'"

Even as Gottlieb's own story unfolds, alongside it are the tales of the other dot-commers in their own words. Most of the anecdotes, while not new, capture the hubris of the time. Doug Levin, a former Microsoft executive, recalls one business plan that was passed around for Cement.com. "The thinking was, if you could believe in a 50-pound bag of dog food being shipped, you could also deliver a 50-pound bag of cement."

It's all here: how the majority of dot-coms rushed into the market with masses of capital backing them but no business plans; how firms routinely equipped twenty-somethings with Blackberries and laptops and furnished offices with Aeron chairs, which Rare Medium's Shuli Hallack joked were "the highlight of the Internet revolution."

Gottlieb and Jacobs also detail how the industry set young against old as Old Media types from publishing, film and TV spread into the Internet culture. Richard Titus, a former vice president of Razorfish, says the 20-year-olds would point to eToys and tell him how it would crush Toys R Us, something that never happened.

"Young people sold fear," Titus says. "It was almost like being in the extortion business in 1990."

At the peak of dot-com mania, the lavish parties might have had something to do with many businesses' burn rates. One company, TixToGo, hired Cirque du Soleil dancers and gave away a Porsche. Event planner Heather Keenan said she'd ask caterers why it cost $150 per person for peanut butter sandwiches. Their reply: "Screw you – I've got four other parties that night."

At the same time, dot-com marketing reached new heights of hilarity, often unintentionally. At DEN, the founder was charged with alleged homosexual pedophilia while at the same time, according to former employee Matthew Klauschie, the firm launched an ad campaign around: "DEN, Spank Your Mind 'And the whole theme is Spank! It was, Spank everything!'"

Obviously, things couldn't continue. Neuman says that in the summer of '99, DEN's burn rate reached $5 million monthly. "Some of us had heartburn on a daily basis."

Lawyer Peter Heinecke recalls that at one company he worked for, the CEO believed the large amount of money meant for his firm was actually a personal piggy bank. He transferred cash out of the company bank and spent it on everything from helicopter rides to stereo equipment. "There was a real shortage of seasoned controllers and financial people around."

Philip Kaplan's F'd Companies is funnier and more sarcastic (Kaplan is one of the many people quoted in Kibu), but Inside the Cult of Kibu neatly packages the history of the dot-com days. Encapsulating everything that was good – but mostly bad – about the New Economy, Inside the Cult of Kibu deserves a place on the bookshelf right next to that other classic of digital bubble-popping, Michael Lewis' The New New Thing.